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Cost to Company Concept and Practices

Last post January 28, 2009 08:49 AM by sarahdcruz. 1 repiles.
January 28, 2009 08:45 AM 1
Total Posts: 27
Join Date: May 26, 2008
Rank: Executive
Post Date: January 28, 2009
Posts: 27
Location: United States

Cost to Company Concept and Practices

Dear professional Colleagues,

Can anyone share the practices of Cost to Company compensation structure for Management Staff in Manufacturing/IT/Service Industry as this is the buzz word in the business world. I specifically want to know the cash,kind and perk composits including the treatment of Fringe Benefit Tax and other indirect costs how they are treated or included/excluded in the Cost to Company Compensation structure.

Please do share your knowledge and practices.

Regards

dharm
January 28, 2009 08:492
sarahdcruz
Total Posts: 14
Join Date: May 26, 2008
Rank: Executive
Post Date: January 28, 2009
Points: 70
Location: United States

Re: Cost to Company Concept and Practices

If u r a recruiter / hr guy and is giving offer to a prospective candidate, CTC should include basic pay, dearness allowance, other allowances (paid in money), HRA, LTA, Performance / annual pay, retiral benefit like employer's contribution on PF, gratuity, superannuation fund. Most right minded organisation generally dont include medical reimbursement (if reimbursed in actuals), interest subsidy on loans, FBT and perks incidental to work like driver's salary, mobile, laptop, club reimbursement etc. However often if there is a ceiling on medical expenditure ( in many cases 1or 2 months pay), that becomes part of CTC. However in a mad scramble, these days recruiters' tend to include most of the above to jack up CTC. The thumb rule is however to maintain that 60% of CTC divided by 12 should be the monthly gross pay.

However if u r looking at CTC from a chartered accountant's point of view, CTC can include wide range of indirect and incidental cost including calculating the cost of floor space for occupying the corner office in a highrise commercial bldg.

Regards

Sarah Cruz
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